Wednesday, August 30, 2006


If you recall from my previous rantings, I said that businesses pay for all of their expenses by the money they get from their customers.
This is not a crime, just the way things **are**.

All of the costs of doing business – no matter what business a company might be in – are paid for by the people or other companies that buy the products of that company.
These costs include raw materials, wages, utilities, paper, pencils, rent – whatever.
In addition to the costs that I just listed, there other items like federal, state and local taxes.
I pointed this out in a preevious post.

It also includes health insurance for the employees.
Did it ever occur to you that you are paying for the health insurance of the workers of the companies that you buy products from?
Well, yoo doo.
Eevin if yoo doo not hav health insurance yurself.

BTW – understand the concept of “insurance”.
Basically, people buy – as in PAY for - a “service” that they do not need and hope they never need.
Thus, the customers who do not need the service pay for the costs incurred by those customers who actually do need/use the service.
Does this sound stupid to yoo?
Just thought I would ask.
Weird as it is – it woiks.

And this leeds mee tu a pet peev of miin.....

I think that companies should get out of the business of providing health insurance for employees.
“WHAT?” yoo sa. “How will I get any health insurance?”
Here’s how – you will shop for it just like yoo doo a car or beans.
Or like you shop for insurance for your car or house.
You will compare features/benefits against the cost of the policies offered by various companies.

To offset the loss of this benefit, companies will have to increase wages a bit.
But the increase will not have to equal the cost of the insurance they no longer provide.
Because the cost of health insurance will decrease when you introduce competition into the market.

Insurance companies are in business to make money.
Again, not a crime.

They set their rates based on actual costs of people using their services (claims) and whatever profit margin they want to tack on top of their costs.
They justify their prices by saying that certain “populations” (groups of people) have higher or lower total claim costs than other populations.
Technically this is true.
But they never show you these figures so you can make a judgement for yourself.

Usually, the insurance companies give better (lower) rates (per policy) to bigger companies and charge more (per policy) to smaller companies.
Question: what does the size of a company have to do with the general overall health of its employees?
Or the amount of insurance claims they make?
This correct answer is: NOTHING!
This is just a way of jacking up the price of insurance coverage.

If you really wanted to tailor the cost of health insurance to actual expected claims, you would segregate all smokers, drinkers, dopeheads, and fat people from the rest of the population.
(about 70% of the population)
These people would pay the highest premiums because they are the most likely to have health problems.
No matter what size company they work for.
Then you would isolate all runners, walkers, weight lifters, aerobicists, and anybody with a bodyfat reading of 20% or less.
(about 10% of the population)
These people would pay the lowest health insurance premiums because they are the least likely to have a health claim.
Those remaining would pay a health insurance premium somewhere in between the previous two.

This is what the insurance companies do for auto and homeowners insurance.
You would only have to pay for the coverage you wanted/needed.

By having all of us shopping for health insurance, the insurance companies would reduce policy prices to get your business from their competitors.
The insurance companies would put pressure on hospitals and doctors to control costs.
Hospitals and doctors who did not provide the lowest cost services would be dropped by certain insurers, putting pressure on them to become more efficient.
The days of the ten dollar Band-Aid would be over.
The same pressure would be put on drug manufacturers causing a similar reaction.

The operation of the free market always lowers costs (in the long run), makes businesses more effecient and benefits the consumer.

Class dismissed.

Maintain the 180.

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